Gap Investors Won't Lose Their Shirt

Shares should rise further, aided by strong December sales, the purchase of boutique operator Intermix and a $1 billion share-repurchase plan.

The Gap was busy making news Thursday morning, as the apparel retailer reported strong same-store sales, announced the acquisition of a boutique operator and unveiled a $1 billion share-repurchase plan.

We think this positive roll will continue.

Before Thursday's opening bell, Gap (ticker: GPS) announced 5% same-store sales growth in December, ahead of the 3.5% that analysts were expecting. The company also said it would buy...